Ariel Investments’ Charles Bobrinskoy: It’s ‘Silly’ to Expect Inflation to Stay Low

Inflation is poised to skyrocket, and savvy investors should protect their portfolios now, one portfolio manager advises.

Inflation expectations are now relatively low, economic data show, “which is just silly,” Charles Bobrinskoy, head of investment group at Chicago-based Ariel Investments, told CNBC.

The median expected price change over the next 12 months, as measured by the University of Michigan’s Surveys of Consumers, stands at 2.7 percent, reported. For some perspective, the expectations for inflation in 1980 rose as high as 10.4 percent.

Inflation expectations have been more or less contained at 2 to 3 percent between since late 2014. Actual inflation has run below 2 percent, CNBC reported.

Meanwhile, the Federal Reserve Bank of St. Louis’ 5-Year Breakeven Inflation Rate, another measure of expected inflation, is 1.89 percent, its highest levels since mid-2014.

Bobrinskoy points to some key factors that could push inflation higher, including a strengthening economy and the



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